Postmates to pay 2-plus years of workers' comp in independent contract dispute

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Dive Brief:

Washington state’s Department of Labor and Industry ordered delivery startup Postmates to pay workers’ compensation premiums for 3,011 couriers, says GeekWise. State auditors said the company misclassified the couriers as independent contractors. Postmates plans to fight the charges, said GeekWise.

A few couriers experienced on-the-job injuries and filed workers’ comp claims, which triggered a state audit. L&I looked into the claims and found that Postmates classified couriers as independent contractors and therefore didn’t pay them workers’ comp.

The state concluded that the couriers weren’t exempt from workers’ comp coverage and ordered the company to pay retroactively its 3,011 couriers two-plus years of premiums.

Dive Insight:

Postmates’ dilemma typifies the challenges facing companies in a growing “gig economy.” Uber workers have taken that company to court, charging it with misclassifying their status. Until clearer definitions evolve on the status of independent contractors, temporary workers and freelancers, employers who depend on them will continue to have problems complying with federal, state and local regulations.